DESIGN GAP – /gap between the original concept for the service and that ultimately specified by the organization/. While the Station Manager Programme was created an appropriated and realizable service standards should be incorporated, which has not been done. The concept did not make any radical changes to decision making processes, work flow and chain of command which were let practically unchanged. Its success is doomed from beginning.
THE COMMUNICATIONS GAP /gap between what the organisation promises to its customers in its external communications (whether directly or indirectly) and what it delivers/. The “We are coming back” campaign which cost $2.1 million and had a purpose of tempting passengers back to use the subway largely failed as riders saw a massive gap between promise and delivery. Gene Russianoff commented "It is premature to crow and expect people to believe it". Another example is “Operation Enforcement” where misunderstanding, opposition inside the organisation, legal suits and ruling led to failure of it.
THE ORGANISATION GAP /the gap between the organisation's perceptions of customer expectations and actual customer expectations/. The perception inside the organisation and even share by some staff /Howe/ at the station 231st is that customer expectation are just about moving them from A to B. But the customer demand has increased and they expect some extra value for their money than just “transport” from A to B. The attitude of staff has changed since the introduction of SMP at least on the stations participating in it.
Customer expectations maybe set and influenced by organization’s marketing activates, especially where it is communicating a powerful image of the service, but those attempts have failed in NYCTA and I think John Gerst is aware of which put extra constrain on him to get it right this time as a manager at 231st Station. If we add the fact that he has a little formal authority his position become even more difficult only his power base on his personal qualities such as determination, assertiveness and persuasiveness allows him to attract and influences decisions and get some things done at Station 231st i.e. new turnstile.
But the truth is, what the customers encounter when they entry the station. Even greeting manager is not able to divert attention from queues, broken turnstiles, crowded platforms and illegible sins and walls coated with grime and steel dust. And that is the reality. However, there is an attempt by Kiepper to underline the importance of customer service issues and address them by creation of the Customer Service Department. But in highly territorial divisions it does not look promising and more there is the risk of further aliening it as a consequence a transactional approach to marketing chosen or not by Kiepper. The activities of the department are not connected to day to day operations and characterizing by short time focus, ad hoc customer satisfaction surveys and lack of internal marketing. On other hand, there some positive symptoms at the station 231st attempts to applied the market lead approach. But it does not go beyond the SMP, having a little impact on the activities of staff outside the station.” It is the customer’s perceptions of their experience, not the perceptions of those delivering the service that determine the level of customer satisfaction” Another useful tool to measure customer satisfaction is SERVQUAL scale /Parasuraman, Zeithmal and Berry, 1985/.
SERVQUAL
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Reliability – the ability to perform promised service dependably, accurately and consistently over time. There is some evidence that they perform well in areas such as a cleanliness of the car fleet and improving the on time performance as consequence of the fact that one division has a control over it but when the areas of responsibility were overlapped like on the stations the approach broke down, and then it is every one for itself.
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Responsiveness – speed, flexibility, promptness, and willingness to help. They have a will and consciousness that is as far as it gets, maybe apart from Gerst, who wants make the difference. The feeling among the personnel at station is that some sort of reward will help.
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Assurance – knowledge and courtesy of staff and their ability to inspire trust and confidence. The Station manager Programme is seen differently by staff, Howe concern with chain violation, Yamanche with managing limited recourses across the station. This is not the right attitude.
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Empathy – caring individualised attention to customers. There is no clear evidence about it , but you can sense that the feeling is different, that the program is treat as a little intruder which come and destroyed their little worlds.
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Tangibles – physical facilities, equipment, and staff appearance that convey functional and symbolic meaning. The NYCTA does not do good, general state of decoy in stations, and sense no one cares, broken turnstiles, staff lacking direction , more concern about themselves /Roberson/ some are uncomfortable with a new order /Howe, Yamanche/ . It shows again that customers concerns mostly about tangible aspects.
As different customers will attach different degrees of importance to each of these factors, it is important for john Gerst and his team at Station 231st to understand the preferences of their own customers, which is not full yet understand by even some people on Station /Howe, Yamanche/
2. COORDINATION BETWEEN DIFFERENT DEPARTMENTS OF THE ORGANISATION
In order to have a deeper look inside the organisation activities at Station 231st and therefore better understanding I have decided to use the PROCESS-FLOW DIAGRAMMING - (Shostack 1984) shown in Figure 2. Service blueprints are a visual description of a service system, providing a framework for service design or re-design
NEW YORK CITY TRANSIT AUTHORITY – 231st Street Station
Physical evidence printed timetable Token Train
Customer actions Customer at station Queue for Queue for Waiting for train Board
Bus & pedestrian Token kiosk Turnstiles on platform train
JG ‘meet
& greet’
Line of interaction
Onstage contact Token Sale of Transit Pass Train Train
employee actions Kiosk Token(s) Police Working Driver arrival
staff presence turnstile
Line of visibility
Backstage contact Token ‘Cash up’
employee actions Kiosk Kiosk till
staff
Line of interaction
Support processes Token Obtain token TA Turnstile
Kiosk Supplies maintenance maintenance
Staff staff
Figure 2. Blueprint for Station 231st
Almost all activities taking place at the Station 231st take place in the line of interaction and are visible for customer. In fact, staffs react on customer action. Service blueprint breaks down the operation into different steps, showing what occurs in each step i.e. queuing for tokens, turnstile, passing through, waiting on the platform etc...from the customer’s perspective is a logical path to take. The above blueprint shows: customer actions perform in acquiring, consuming & evaluating the service at Station 231st going to next process steps of front-office personnel, those who served them like John Gerst, office clerks; their actions, being visible to them are classified as onstage contact employee actions. Other actions by front-office personnel might not be visible; these are classified as backstage contact employee actions /token supplies/ and finally support process – performance necessary for contact activities to take place in delivering the service /turnstile maintenance/. We can clearly see that the direct evaluation of the process by customer starts from the moment of entering the station and ends on the departure from the station.
For John Gerst there are two crucial moments in the line of interaction with a strategic importance; the process of selling tokens and process of passing through the turnstile. The two most fragile points in the customer flow trough his station. In order to make sure that it will be a smooth process he has to rely on the others departments. And this is when the problem starts. As each division have different goals to achieve. (Mr. Kiepper wants cooperation, Mrs. Maisonet wants cost effectiveness, and MrGrifin wants credibility, Howe concern with chain violation, Yamanche with managing limited recourses across the stations and not short cutting the work order process. He is stuck having two options wait, wait… or violate the command chain and get things done for example the new turnstile furthermore, when John Gerst needs resources, he has to call the revenue division, for maintenance, he has to call the maintenance division. He does not control any significant budget, for example there might be a clear business for a new turnstile /calculation in fare evasion and crime rise problem/ , but in the face of funds cutting and existing budget it is lees likely that the potential impact on revenue by reducing fare evasion will be favored. It become apparent that in order to get things done Gerst needs to understand and balance the different interest and perspectives of the people from number of different departments. The major construction is due to the capital program, which means it is funded either from the city, the state, the federal government, or from bond issue. The work that maintenance forces do, that operating budget people have, basically comes from the fare box, which means that capital work is funded from a different source and the operating departments would not have that. The money would be under control of the capital budget people. If we add strong administrative type of controls imposed through rules, budgets, job categories, promotion, disciplinary procedures, job definitions, chain of commands just makes Gerst work almost impossible. Also, as he has on direct authority he needs to successfully influence a key people by building relation ships and networks such as with Capt. Thomas Griffin, Transit Police.
The Station Manager programme was created put the station as central plan of improving of customer service. But it seems that only person which is trying to make the difference and working hard is only John Gerst. But how long he will be able to carry on without significant support from others departments and against the general culture of the organisation. Another tools to look better understanding of the key capabilities involved in creating the service it is involved with is the value chain /Figure 2/.
Figure 1. The Value Chain (Porter – 1985)
The idea of the value chain is based on the process view of organisations by analysing organisation as one system. It is made up of subsystems / in our case planning and developing/ each with inputs, transformation processes, and outputs, which involve the acquisition and consumption of resources, in our case funds, labour, maintenance, stations, tracks, subway car fleet, administration, and management. How value chain activities are carried out determines costs and affects profits. But internal problems of effective control, collaboration, and coordination between different departments and agencies responsible for service delivery affect badly the outcome. The value chain is poorly managed with departments on one part of the chain have a little consideration of the impact of their action on the department on the other part of the chain. There is a clear indication of lack of cooperation and co-ordination, across department’s boundaries. From the beginning, the whole concept of SMP was based on ad hoc surveys and Kippers observations. I am not saying that SMP was a bad idea, quite opposite; I think it was the last moment at least to try to divert the attention of the organisation towards the customer when it seems that NYCTA has lost somewhere the meaning of the purpose that it was created for... customer.
The only initiative to genuinely address the lack of cross-functional collaboration plaguing the TA was The Station Manager Programme in which Gerst plays a major role. It has brought some changes to the way people work in the stations, but it has a little impact on the activities of staff outside the stations.
STATION MANAGER PROGRAMME implemented in NYCTA represents a radical approach to improve operational performance /Figure 1/ since it represents a major departure from traditional reporting lines and ways of operation. The most radical changes in improving the performance are:
- take back control over station /maintenance, fare evasion, cleanliness, turnstile problems, the homeless and quality of life issues/ as so far they received a little of attention and yet that was the first thing what customer see
- address the customer needs, to this point no one was addressing customers concerns directly
- cuts trough the bureaucratic lines by concentrating responsibility and authority in one hand the station manager and hold him accountable.
Figure 1. Incremental improvement versus radical improvement
However, one can argue that is incremental improvement to operational performance because it included just some stations and the expanding rate was about 25 to 50 every six months. Secondly, that only staff from participating station were involved.
Improving operational performance can lead to improving financial performance. The performance - importance matrix /Figure 3/ might be one of tool to think about priorities for improvement. . The idea of matrix is provide a graphic representation of how the operation performs against key performance criteria, and how much those criteria matter to the organization’s customer. I have chosen two aspect of performance on the Station 231st ease/speed access especially during peak hours and the safety issue. The selection was a respond to concerns voiced by customers.
Figure 3. The performance-importance matrix
When you plot the criteria /safety/on matrix most of them has landed in the worsen than–medium square and ease/sped access has landed in worsen than–high square. Both require urgent action for improvement. As the operation performance is much worse than the competitors, in criteria that customers consider as important. This is one more argument for John Gerst for a new turnstile and another confirmation where he has to make first improvements.
3. FARE EVASION
The Division of Revenue is responsible for is the collection, counting, depositing, reconciliation of all the fare for New York City transit plus the maintenance. Anything that counts, collects, or stores money; the Revenue is responsible for it. In order to improve the financial performance there is a need to improve the operational performance. It might be done by installing a new turnstile, which in turn might cut fare evasion.
Total installation - $26,288
Maintenance - $52 per month
Average number of "registrations" per week in 1995 at 231st Street Station: 40,201 (2,096,195 per year)
Estimated percent of fares evaded in 1995 at 231st Street Station: 2.8%
Revenue per fare=$1.25
Revenue lost per year through fare evasion = 2,096,195 x 0.028 x $1.25 = $73,367
Costs in first year = $26,288 + /12 x $52/ = $26,912
$26,912 divided by $73,367 = 0.367 x 100 = 36.7%.
The investment would pay back within a year if the reduction in fare evasion as a consequence of installing the gate would be 36,7% .Higher reduction in level of the fare evasion will short the time needed for reaching the breaking point, for example reduction by 50% will give us the breaking point in 11th month.
It is a clear business case for installing new turnstile. And it should be done, because it is not about the money it is also about improving the performance, the quality of delivering the service by cutting passing time through turnstiles, which should reduce possibility for offenders to jam them and every jump over them will be much more noticeable.
DISCUS WHAT YOU HAVE LEARNED FROM THE STUDY OF THIS CASE.
- need for cooperation and coordination between departments, otherwise the chance to succeed is greatly reduced; lack of it is harming SMP in NYCTA case.
- before you embark on any project have a plan, even more, have a plan how to execute the plan, I think in the case there was no great amount of planning which will not help in coordinating the activities in NYCTA
- if project involves changes, prepare/train /involve all interested parts in your project, it is important to have a whole organisation involve to succeed not just some parts / NYCTA/
- create clear organisational structure; the structure in NYCTA is a mess I would say almost unchangeable.
- define responsibility and make somebody accountable , lack of accountability has led almost to the bankruptcy of NYCTA
- keep an eye on bureaucracy
- get decision making people on board /absent them from SMP is slowing the process and changes/
- importance of negotiation and political skills /for example John Gerst is lacking them it would be for him difficult to get something later on / but he is good at building relationship and network around him
- it is important to understand multiple perspectives and processes, probably the most valuable lessons that I learnt. It is crucial to remember that your action affects others people, departments or processes. so try to minimise the negative affect of this action, which might involved planning in advance.
